Amazon's free shipping costing €1,000 per day in France

Did you hear the one about Amazon? It offered free shipping in France, got sued for it by the French Booksellers' Union, and lost. Now it's choosing to pay €1,000 a day rather than follow the court's order. Ba-da-bing! No, it's not funny, but that's because it's not a joke. The Tribunal de Grande Instance (a French appeals court) in Versailles ruled back in December that Amazon was violating the country's 1981 Lang law with its free shipping offer. That law forbids booksellers from offering discounts of more than 5 percent off the list price, and Amazon was found to be exceeding that discount when the free shipping was factored in.

The company was told to start charging within ten days or pay a daily fine. It also owes €100,000 to the French Booksellers' Union for the court battle and for the losses it has apparently caused them. With the holidays over and the ten-day grace period over, Amazon has officially announced its plan to ignore the court order and pay the fine instead, according to the International Herald Tribune.

Amazon can do so for 30 days (€30,000), but after that time the court will review the fine. They could raise it, or they could lower it, but given that Amazon has chosen to flip the justices the bird, guess which outcome is more likely? At some point, if Amazon doesn't change its ways, the fine will probably be jacked up so high that the company has no choice but to comply.

Jeff Bezos, Amazon's CEO, has taken to the virtual airwaves to rally the French public in support of Amazon's free shipping. He sent out a recent e-mail to French customers in which he claimed that "France would be the only country in the world where the free delivery practiced by Amazon would be declared illegal." He then asked people to sign an online petition that has so far garnered more than 120,000 signatures.

It's a bold and potentially antagonistic move for an American company to make, but Amazon is serious about its free shipping. Judging from the response to Bezos' e-mail so far, so are Amazon's customers.

News source: ArsTechnica

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I'm an American and I believe Amazon should comply with the French law even if just out of respect for the French. It really isn't going to matter soon anyway since the France is bound to jack the fine up so high Amazon won't be able to afford not to comply.

When you think about it, Amazon is so large, it can defy French laws with its power. This is precisely what the law is about : preventing concentration of power. Some things as culture cannot just be safely governed by economic laws, else this can lead to dangerous situation. This is the same with Media. Unfortunately we do not have an anti trust media law in France and it lead to only 3 large groups controlling 85% of written press. This is dangerous too for democracy.

I do buy books on Amazon. Mainly cause the shipping is free and I want to send offer them to distant people. And also to buy books in English. I too will immediately "suffer" from this decision but we have to consider greater goods over lesser ones.

Enough with the French bashing already: it's really getting old and boring.

It's a more general problem of companies doing business in various countries: the companies are expected to comply with the laws of the countries they are doing business into.

For the U.S. members, don't you think that any French company which imports foods in the U.S. should comply with the F.D.A. rules? Did you fly any Airbus planes recently? These planes must have been checked against F.A.A. regulations ...

Amazon France is supposed to comply with the Lang Law (Jack Lang is the name of the Culture Minister who enacted these laws a long time ago). The French Booksellers' Union found that the free shipping offer of Amazon.fr was unfair competition and a tribunal found Amazon guilty and Amazon was condemned. That is the law: it may sound silly but if Jeff Bezos wants it changed: he has to see the French Parliament and make a law proposal, not an online petition.

Those administrative bodies are concerning public safety issues, not about a company who is providing a service at a competitive price. The Federal Trade Commission is in charge of that. Now if the FTC fined Toyota for offering incentives on their vehicles that hurt sales on Ford, GM, and Chrysler, the Japanese governement would be completely up in arms (I know it is far fetched, but its the best I could come up with ). I understand it is the law, but laws have been changed in the past when they are deemed not in the publics best interest.

Yeah we could also say your US laws about forbidding the importation of unpasteurized cheese is silly, but we don't. As if it is so dangerous that we all fall dead eating some. anyway we keep the good cheese and we send you the bad

Actually, your examples are quite good. The one about Toyota and the Japanese government is possible: it would be understandable if the FTC fine was unjustified or part of an anti-Japanese campaign in the US but that would be "unfair protectionism" and something that the WTO would have to deal with.

The question of the public's best interest is more complex: it's not just lower price at all cost for the end-consumers. There are lots of small book shops (often specialized) all around France. The price of the books are fixed by the editors. Who would you go to if you have an online vendor which sellss you a book delivered to your house and a book shop you have to go to buy the book for the same price?
Of course, one would choose the first vendor and the book shop would close because it would not be able to compete. A lot of people will say that this is normal in capitalism system and it's true but the French law has been designed so that small book shops can continue to exist and the creation of large scale monopoly regarding culture goods can be prevented.
It's the current law: it can be changed, it can be revoked but via the French parliament and not with Jeff Bezos's pretty face telling "But I am Amazon!!"

You may laugh at us, we just don't care. We are a small country compared to most but we are proud of what we are.

Please people that doesn't know anything about the subject, restrain from posting. You give your opinions without knowing... This is so lame.

I am French and I can understand and approve this decision. Even though the shipping price is not actually part of the price of the books, it effectively gives a real advantage to Amazon compared to the competition. The decision completely respects the spirit and purpose of the law, which is a good law cause we are glad to have book stores everywhere and it contribute to protect us from illiteracy and lack of culture.

...as opposed to other countries like Canada and the USA who also shop at Amazon? Yeah, having an online bookstore with free shipping has just destroyed culture and literacy in these countries. Too bad we don't have the same law! Why oh why did Amazon make books more affordable and available?

OH NO! Amazon = competition?!?! What a terrible thing to have for the economy!

Please people that doesn't know anything about the subject, restrain from posting. You give your opinions without knowing... This is so lame.

That has never stopped anyone from posting comments about other countries. In the US, we have libraries which allow people to use a book at no cost, yet illiteracy is still high. We also have bookstores all over the cities and some towns, still same result. Having access to a local bookstore does nothing to combat illiteracy. Now if you want to argue that Amazon does not offer enough French cultural literature, you may have a point since I did not research that.

Xilo said,
How does a fixed price market create competition and encourage literacy?

Because competition reduces risks of concentration, oligopolies, monopolies etc,,, thus reducing the offer. Small Shops contribute to enlarge the offer. On Amazon you only find common books not rare ones. More shops means that it's easier to find books. This it contributes to democratize books and contribute to reduce illiteracy. I'm not talking about not knowing how to read and write but more about lack of culture.

And talking about culture, most common Americans lack of it. When you realize that some does not know where France is located or even this is a country.... It makes me laugh. The American educational system is so bad before college, if you don't go to university, you're mostly ignorant of things in the world... This is so sad only rich people have access to good education.

PogS said,

Because competition reduces risks of concentration, oligopolies, monopolies etc,,, thus reducing the offer. Small Shops contribute to enlarge the offer. On Amazon you only find common books not rare ones. More shops means that it's easier to find books. This it contributes to democratize books and contribute to reduce illiteracy. I'm not talking about not knowing how to read and write but more about lack of culture.

And talking about culture, most common Americans lack of it. When you realize that some does not know where France is located or even this is a country.... It makes me laugh. The American educational system is so bad before college, if you don't go to university, you're mostly ignorant of things in the world... This is so sad only rich people have access to good education.


Generally, a free market and competition helps the industry more so than standardizing and price fixation. If you are unable to provide an incentive for consumers to visit your store, there really is no competition. The only difference between different stores then comes down to accessibility and stock. If you have a bookstore, why would I want to shop at your store as opposed to the several other bookstores that offer the same books? Sales, discounts, special offers, lower prices can dramatically help drive sales and create customer base. From a business perspective, it's not that hard to understand. This type of law is really just worthless in a free market and democratic society. Oh I forgot, France isn't that type of country...

One reason why a lot of Americans lack culture is because of how large the country is and our location. With a country like France, it's a small country surrounded by many other countries with distinct cultures and languages. The most the United States has is Mexico. That's about the only different culture we have a large access to. There's also Canada, but it isn't that much different from the United States. We simply don't have access and exposure to the diverse cultures as a whole like countries in Europe do.

Only rich people have access to good education? Please... I come from a single parent family. My mom makes less than $20,000 a year. You know what? All my school is paid for because of that. It's all paid for through scholarships and grants by the government. The people that hurt are middle class people that make too much to qualify for these grants and scholarships but not enough to easily pay for school.

Hum USA is a free market : you are one of the countries that use protectionism and subventions the most. We are a democratic country : every citizen can vote for his president, we have many political parties, labour parties, etc...

Regarding culture, this is a matter of openness to the world. Your education is mostly focused on you not on others. So you end with a partial vision of the world. Did you study the history of France at school ? I'm pretty sure it is not taught. I did study the one of the USA even though not thoroughly.

Access to education : it seems to me access to grants are based on performance at school which is generally lower when you come from a poor environment. This is also true in France and I guess everywhere in the world.

Why not ask the EU who is so busy grabbing cash from innocent American corporations to even notice the consumer.

C_Guy said,
Why not ask the EU who is so busy grabbing cash from innocent American corporations to even notice the consumer.

You're talking about Microsoft ?

C_Guy said,
Why not ask the EU who is so busy grabbing cash from innocent American corporations to even notice the consumer.

Yet another ignorant comment that is completely off topic - you clearly have no understanding of the situation. Still, that's what nationalism does. Perhaps you should stop basing all your opinions on what the media say and actually think for yourself?

so free shipping is a discount, what have the french being drinking

from what i understand the cost of a book and postage are 2 separate things

That law forbids booksellers from offering discounts of more than 5 percent off the list price, and Amazon was found to be exceeding that discount when the free shipping was factored in.
Umm shipping cost is not part of a book's list price so how did the court even rule against Amazon? Makes no sense.

Shipping cost is a part of the book price if the shop sells only by shipping, which is the case for Amazon.

You can find more precise information here :

  • http://en.wikipedia.org/wiki/Lang_Law

In fact, this law vas voted to prevent small bookshops from totally disappearing in France. In countries where book prices are totally free, books are either sold in big retail stores or in bookshops that belong to a national network (Barnes & Noble for example). In these kind of shops, it is difficult for a consumer to have independant advices on books or to find other books than the usual best-sellers. And moreover, these shops do not open in small towns.

Yes, this law implies that prices cannot be discounted on books (except for used books), but it helped a strong network of independent bookshops to survive and to promote a larger variety of litterature.

And the law is not unique for France. In Holland we have the same law.

Bol.com had to pay once, because they allowed gift cheques of a third party to be used to purchase Dutch books, which was considered a discount.

So the best way of buying a Dutch book is to order it from Belgium with discount plus free shipping...

I also disagree with this, but people who voice their opinions should first understand that France is very protective of its national industry. While i don't believe that this is the ultimate solution, it has certainly proved very effective in protecting french jobs ranging from train drivers to farmers.

Orlando Rays said,
The French unemployment rate is still in the 8% range, and for decades it was over 10% even with these controls.

8 % is quite low with all the measures the government takes to keep the current level of social security. I would move there even if I earned more elsewhere. Canada is at 6.4% and has nowhere near the government services that France has.

France needs to sort out its laws...this is hurting customers. I couldn't care less about Amazon but laws like this just make people have to pay more for everything.

Spain has a similar law, retailers can't apply more than X percent discount on books. But I never though they'd factor the shipping costs in!